Consultancy banned from public contracts over links to corruption scandal

4 August 2022

Consultancy Bain & Company has been blocked from UK Cabinet Office (CO) contracts for three years due to its role in a South African government corruption scandal. 

The CO said Bain & Co will be barred from taking part tendering processes, while guidance will be issued to other government departments to do the same.

The move follows the company's involvement in a corruption scandal involving the former president of the South Africa Jacob Zuma.

A South African judicial review into corruption found in January there had been “collusion” between Bain and the former president to “seize and restructure” the South African Revenue Service (SARS).

Since 2018 Bain has been awarded UK public sector contracts worth up to £83m, including £40m worth of Brexit consultancy work. However, the firm is not a current supplier to the government.

A CO spokesperson said: “After reviewing Bain’s role in alleged state capture and corruption by the former government of South Africa, taking account of the evidence and conclusions of the South African Government Commission, the minister for government efficiency considered Bain to be guilty of grave professional misconduct. We have consequently excluded them from competing for Cabinet Office contracts for a period of three years.

“This decision has been taken in light of Bain’s responsibility as a global brand for its South Africa division and the company’s failure to clarify the facts and circumstances of its involvement.”

In a letter seen by the Financial Times, minister for government efficiency Jacob Rees-Mogg told the company: “Bain & Co is guilty of grave professional misconduct which renders its integrity questionable.”

Bain said it was “disappointed and surprised by the minister’s decision”.

It added: “We will be responding to express our concern about the process and its outcome, where recommendations from the Cabinet Office were apparently overruled, and to address inaccuracies in the minister’s letter.

“Bain have apologised for the mistakes our South African office made in its work with the SARS and we repaid all fees from the work, with interest, in 2018. Bain South Africa did not act illegally at SARS or elsewhere, and no evidence to the contrary has been put forward. Neither commission of inquiry in South Africa has recommended any charges to be filed. We have offered our full cooperation to the relevant authorities and will continue to do so.”

Lord Peter Hain, who has been urging the government to cut ties with the company, told the House of Lords in July that Bain’s “complicity in corruption” was “inexcusable”. He said the government was “shamefully slow and negligent” in barring it from public contracts.

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